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Is the House Republican Conference the ACME Corporation of our time—selling crazy products that fail at the worst possible moment? This week’s product was Plan B—a short-lived back up plan hatched by House Speaker John Boehner to give Republicans (and Boehner) political cover should negotiations with the president over the fiscal cliff deadlock. The plan backfired. Instead of Republicans leaving for the holidays with the Speaker’s bargaining hand strengthened, evening headlines noted falling financial markets and a GOP conference beholden to its uncompromising far-right flank.

How should we interpret Thursday night’s events and their consequences for resolving the fiscal cliff? I thought I’d offer some initial observations.

First, even without a roll call vote, Thursday’s drama provides some clues about the conflict roiling the ranks of the House GOP conference. Most reports last night noted the apparent disbelief of House GOP that Boehner’s plan had failed. Moderates in the conference knew whom to blame. As retiring Rep. LaTourette put it, “It’s the continuing dumbing down of the Republican Party, and we are going to be seen, more and more, as a bunch of extremists that can’t even get the majority of our own people to support the policies we’re putting forward,” he said. “If you’re not a governing majority, you’re not going to be a majority very long.” Of course, moderates are a dying breed, and so we don’t know for sure how widely his interpretation is held across the conference. We do know that on the spending showdown in April 2011 and the debt ceiling drama in August 2011, roughly 25 percent of the House GOP conference voted against the final bipartisan agreement. Tonight’s failed bill reflects that tension in the conference—a rift between legislators who won’t budge from their anti-tax ideologies and those who appear willing to entertain compromise. For today at least, the ideologues won.

Second, I am (perhaps too) slowly coming to the position that it might be impossible to avert the fiscal cliff. That will certainly be the case if Boehner refuses to bring a deal to the floor that requires Democratic votes for passage. That wasn’t his position in the spending and debt ceiling showdowns in 2011. But neither did those bargains require Republicans to vote directly or indirectly to raise anyone’s taxes. Indeed, House Republicans have steadfastly avoided such votes since they voted against George H.W. Bush’s 1990 “Read my lips” budget agreement. Old anti-tax habits die hard. This is probably especially so when the Club for Growth threatens to “primary” Republicans who vote to raise anyone’s taxes. This dynamic—at once electoral and ideological—may be sufficient to detonate the short fuse left on the exploding can of sequestration and tax hikes.

Third, to avert the fiscal cliff, we may need a replay of the first TARP vote in 2008—the only time I’d ever watched a congressional vote tally side-by-side with a plummeting Dow Jones industrial average. This time, harsh market and public reactions would be necessary (though possibly not sufficient) to force the hand of the Speaker to go back to the table and negotiate a deal that can pass with Democratic votes. If the GOP takes a beating in the headlines and markets tank, rank and file GOP might demand that negotiations resume. It’s Boehner’s job as party leader, after all, to build and protect the party’s brand name. Of course, that requires Senate Republicans—and their leader Mitch McConnell—to feel the heat too. Absent whiplash from markets and voters, “that’s all folks.”

Fourth, Thursday’s turn of events raises uncertainty about Boehner’s future as Speaker. I doubt Boehner will boot any more of his colleagues off of their committees: All four of the deposed committee-men voted against the first leg of Plan B tonight. (Perhaps tossing a fifth-generation farmer—Tim Huelskamp, R-Kansas and PhD in ag-policy—off of the Agriculture committee wasn’t a show of strength after all.) Speaker “Czar” Joe Cannon exploited committee assignments to punish disloyal colleagues at the turn of the last century, and his colleagues eventually retaliated by voting to declare the Speaker’s chair “vacant.” The parallel to 2012 is imperfect, I know. But will disgruntled GOP do the same to Boehner? I think it’s too early to know whether the conservatives who derailed the final vote on Plan B will be satisfied with the message that they’ve sent to Boehner. It’s also too early to know whether rank and file Republicans will heap blame on their most conservative colleagues or on their leader (or both) for Thursday night’s debacle.

Finally, I have thought all Fall that—at the 11th hour—neither party would want to bear the political and economic costs of pushing the country over the fiscal cliff. I reasoned that no president would decide to bring on a “recession by choice,” and that no party would want to be accused of raising everyone’s taxes on Christmas. Instead, I figured that the parties would either kick the can again or adopt a lowest-common-denominator deal that raised top rates and turned off the sequester—and perhaps promised future savings and revenue. From Thursday’s vantage point, I misjudged priorities within the Republican conference. Or, maybe it’s not yet the 11th hour.

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Comments

GOP moderates (such as they are) will, with Democratic assistance pass a bill Dec 30th to extend the Bush tax cuts except for some portion of the 1% (say, Obama's $400,000 cutoff).

Obama gets unemployment benefits extended and either a debt ceiling raise to his liking of the American Jobs Act. (If Obama is awesome... both.)

It's MUCh harder to lower taxes on the 1% than to avoid their being raised in the first place.
Furthermore, it may be VERY dangerous to bring back cuts in the hoarding tax (referred to by very, very rich people as the "Death Tax").

Inheritance taxes going from 35-55% must be defended and now that Norquist agrees that raising top rates is acceptable, I don't see anything stopping them from caving in to the president. Club for Growth is scary, but the billionaires' needs surpass the rhetoric and principle.

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